Coal news and updates

Alpha expects met coal sales down 30pct in 2016

US coal miner Alpha Natural Resources expects to sell around 30% less met coal at 11.6 million st (around 10.52 million tonnes) from its main Central Appalachian mines in 2016 compared to 2014, as its restructuring drives changes in its operating footprint.

Alpha’s 2015 forecast of 15.7 million st for CAPP met coal sales this year, is down from 16.5 million st in 2014, it said late November 3.

Including the Cumberland mine in the group’s eastern US operation, Alpha expects to sell 16.1 million st of met coal in 2015.

“If Alpha’s cuts are applied proportionally across the entire US met coal industry, US met coal supply would decline by more than 21 million st (on an estimated 2015 US met coal production of 66 million st), said FBR analyst Lucas Pipes on November 4.

Based on US met coal industry and company guidance, the emphasis on industry production cuts is likely to be borne by a reduction in export volumes as domestic business is prioritized on more stable and higher pricing through typically one-year contracts.

For 2017, the company expects met coal sales to drop further to 10.7 million st, with volumes stable thereafter, based on the company implementing a Value Enhancement Plan. The VEP is expected to identify operational efficiencies and capture savings within 6-12 months.

source: http://en.sxcoal.com